E114: Evan Padgett

Richard Hill:
Hi there, I'm Richard Hill, the host of eCom@One. Welcome to episode 114. In this episode, I speak with Evan Padgett, CEO at Stealth Venture labs. Evan tells us about a brand they've helped navigate uncertainty, and what was the outcome for them. We talk about the seven areas eCommerce brands ignore until it's too late, and Evan's opinion on the future of eCommerce, and so much more. If you enjoy this episode, hit the subscribe or follow button, wherever you are listening to this podcast, so you're always the first to know when a new episode is released. Now, let's head over to this fantastic episode. This episode is brought to you by eComOne, eCommerce marketing agency. eComOne one works purely with eCommerce, stores, scaling their Google Shopping, SEO, Google search and Facebook ads through a proven, performance-driven approach. Go to ecomone.com/resources for a host of amazing resources to grow your paid and organic channels.

Richard Hill:
Hi, and welcome to another episode of eCom@One. Today's guest, Evan Padgett, COO at Stealth Venture Labs. How you doing, Evan?

Evan Padgett:
Good, Richard. How about yourself?

Richard Hill:
I am very good. The sun is shining here in the UK, which, as most of our regular listeners will know, it's not an everyday occurrence here. So, beautiful day, yeah. And you're in Colorado, you were telling me.

Evan Padgett:
Yep, in Colorado. Sun shining here too, but that's not rare, but happy to be on when the sun's shining there. That's even more special.

Richard Hill:
It's a special day. So, I think let's crack on. So, how did you find your passion for the world of eCommerce? How did you get into it?

Evan Padgett:
Really, I fell into it. It was one of those things, as a kid growing up in the nineties, I was always tech-inclined when the internet of things came to even exist. So, 2,400 modem, dial-up to local BBS systems. And I was at the perfect age where, actually, I never had a computer, but my best friend did. And I was just learning how to freehand code websites, when HTML was starting to evolve. So I just basically found technology in the high school age. And then, when I was 20 years old, in the middle of university actually, that same best friend, he had actually dropped out of high school, not that I recommend that, but he dropped out of high school to join an internet company in Los Angeles that at the time was called Flowgo. But it ended up becoming a company called Intermix Media, most notoriously purchased for, to date myself, a property called MySpace, for those who remember MySpace.

Evan Padgett:
He called me up and he was like, "Hey, you want to move down to Southern California and work as an analyst in our product marketing division?" I'm like, "I don't know what any of those words mean, but let's do it. It sounds fun." And we were running a eCommerce division in 2002 that was doing all sorts of negative option continuities. Anything you could buy on the internet back then, CPM. This was right after the dot com bust, right? CPMs were great. You were sitting at quarter, 50 cent CPMs. Life was good. People clicked on anything on the internet.

Evan Padgett:
What that really drove for me, and to answer the question was, it was just neat seeing the data stream in of what people were doing. I found it really fascinating from the jump to be like, "Oh, I can see that someone clicked on this ad. They landed on this part of our webpage. This is where they clicked. This is where they converted." I don't know. Just really cool to see how that evolved. And at the time when I jumped in, I was doing, this sounds so funny, I was running invoices, or running insertion orders and invoices, which basically just meant, you had media buyers in-house that were procuring media from a publisher, talking on the phone or over email occasionally. And then, they would sign an insertion order via fax, and I'd have to run it around to accounting to make sure everyone got paid and all this stuff as deals were happening.

Evan Padgett:
So, I don't know. I basically jumped in because I grew up with a passion for technology, and always been gravitated towards it, and then seeing how it applied to the digital landscape and the evolving internet and just recognizing as a young kid, I'm like, "Okay, this is going to be some pretty cool stuff." And that's what's kept me in it.

Richard Hill:
Yeah, yeah. So, you've been in it for a while. You've been in it for right from the, yeah, it sounds like...

Evan Padgett:
20 years this year.

Richard Hill:
Yeah, it's like a lifetime. Well, it is a lifetime, isn't it? 20 years in the eCom space, or the online marketing. You've seen it all from, when you say there, yeah, I've had a flashback then of having the fax machine in the office. It doesn't actually see that long ago, to be honest, when I started.

Evan Padgett:
We were fancy. We had fax machines on every media buyer's desk, because deals happen fast. You're trying to get that Yahoo homepage, people wanted, there were $200,000 deals. Things move quick.

Richard Hill:
Yeah. So, obviously fast forward to today. Obviously things have changed a lot since the old dial-up days, that's a fact.

Evan Padgett:
Little bit, little bit.

Richard Hill:
Fax machines. There's none of that anymore, is there? I don't know anybody that has a fax machine. Maybe there's the odd listener listening, thinking, "Oh, I've..."

Evan Padgett:
We find that occasionally some people want a wet ink a contract, which still blows my mind, and we'll do it.

Richard Hill:
So, obviously dealing with a lot of different brands, especially in the recent years, obviously been some challenging times. Maybe, I think it'd be good to give the listeners a bit of insight into some of the projects you've worked on, are are maybe still working on, around the last couple of years. A lot of uncertainty and a lot of challenges, and helping brands navigate this last year or two particularly, and what some of the outcomes of those projects have been.

Evan Padgett:
Yeah. So, very wild past few years. You had a pandemic, which, obviously was, anybody in eCommerce during that time or had an established eCommerce business was loving it, even, because, I mean, let's be honest, during the pandemic, people were shopping at home. They were using the internet more. Everybody had their mobile device or their computer and they were just on it more. More ad impressions, more transactions. If your supply chain was good, you were absolutely crushing it. Then you had all things iOS 14.5-related, which changed the game overnight. So, I've been through a lot in the history of internet marketing I guess, when you look at, I went through CAN-SPAM in 2008, when everyone thought the end of the world was happening, because email advertising was going away. Went through the removal of Flash, which I think was 2012, 2013, so now all the ads that we made, can't use Flash ads anymore, not supported.

Evan Padgett:
And then, the 14.5. Really, you look at Cambridge Analytica, even before then, made it harder to market. And what we've been focused on in the face of that adversity is recognizing that it didn't just make it harder to market. It actually just forced marketers to be better, if I'm being honest.

Richard Hill:
Yeah, agreed.

Evan Padgett:
10 years ago you could get away with a still image and a star burst that said, "25% off. Order today." And that ad would convert. It was like shooting fish in a barrel, whatever analogy you want. Now, you got to up your game. And it's not a major investment, but it is a bigger investment in cash sometimes. In time, especially, and actually just strategy. So... Oh, go ahead.

Richard Hill:
Yeah. I mean, I'm thinking of the days where, it's similar to ultimately, maybe 15 years ago, SEO. It's the same thing. Super, super easy. Just a few meta titles, descriptions.

Evan Padgett:
Oh, yeah. Meta titles. That's all you had to do.

Richard Hill:
"Hey, we're a genius. We're on page one." Whatever it may be. Obviously, there's been some heydays. Launch some DPA ads, run a remarketing cam. Bang, you've got the best ROI that you can get. Now, or then, this last year, it's been a lot more challenging. But I think what it does is, as you're alluding to, it sort of separates the men from the boys, really, doesn't it?

Evan Padgett:
Yeah.

Richard Hill:
In terms of who's doing what. You see what your agency is made of. You see the team around you, and that adapting, and I think this is where, this is really a key message on the podcast, to embrace the change, because...

Evan Padgett:
You have to embrace it.

Richard Hill:
It's inevitable, isn't it? No matter what you're focused on and, to have not all your eggs in one basket. You've got various channels, various platforms that you're utilizing. But ultimately, they're going to change. If you're just using Amazon Ads, for example, that's a pretty big problem, potentially, at some point. But it doesn't mean you shouldn't do it. You know they're going to change things on any platform. So it's adapting, adapting quickly and getting used to that change, isn't it?

Evan Padgett:
Yeah. It's absolutely adapting. And I remember 10 years ago how great it was, and again, I am for privacy, don't get me wrong on this. But man, when privacy wasn't as big of a deal, the amount of fun. I worked in big eCommerce and subscription commerce businesses, couple billion dollar ones where I worked inside before we were working for them. The kinds of fun stuff you could do with marketing by separating out your lists, for example, and back then, you're acquiring most of your customers on Facebook. But you could actually, there were times where I ran campaigns where it was, when I knew people were on there, having just a cohort of people that made their first or their fifth or their sixth purchase or whatever at this company I worked for, we would design marketing campaigns with that level of intel, where basically, you could get to the point where you cohort them based on a handful of very specific criteria like they purchased last month and they've had six orders. I could get a list of them. I could find just those people on Facebook and I would make campaigns for them that would absolutely crush.

Evan Padgett:
Now, you can't do that anymore. Now, the bar is raised and what you have to do is, we have a couple of core tenants that we generally run with, but one, you got to have very relevant ad creative that speaks to what the brands need and what that pain that the brand solves is. And you have to have a brand that is more than just stuff in a box. That's a commodity worked with in my background has been highly subscription commerce. It involves creating an authentic relationship with the consumer that shows that you are providing them a service with the product you're delivering.

Richard Hill:
Yeah, yeah, yeah. Got it. So, more than ever, that investment in creative, which I think quite a lot of maybe, well, maybe not much agencies, but maybe the merchants that are doing themselves more so...

Evan Padgett:
Yeah.

Richard Hill:
It's more challenging, isn't it, ultimately? So, it's that investment, and whether that's working with an agency, or obviously tooling up with more creatives in the business, or a creative in the business might be good start.

Evan Padgett:
Yeah. Absolutely.

Richard Hill:
But, I mean, you also touched on the subscriptions there. I think feathering in or having a subscription within your business, it's something we've talked about a lot this last, probably in four or five episodes now. What sort of things have you seen on the subscription side of things?

Evan Padgett:
So, subscription right now, I would definitely say, I've been in subscription, involved in it for 20 years, my entire career actually. So, I've seen it evolve. I've seen it change. There's a couple things that stand out to me when you start thinking about subscription, or recurring revenue models, which is actually a better way, I think, to put subscription. Because subscription in a business sense, that is a guaranteed set of revenue so to speak that you get over time that's really nice to have when you're operating a business. If you just know that you're going to baseline a certain amount of revenue, sell a certain amount of product or deliver a certain amount of service. That's amazing.

Evan Padgett:
But subscription means that you are, I like to tell people, it's like, look, you're a utility bill now for that consumer. And you have to constantly deliver on your value promise to them. If they're paying you 50 or a hundred dollars a month, every other month, quarterly, whatever, you have to constantly impress them. You have to constantly raise your own bar a little bit, or at least maintain, because I have seen, we'll probably talk about pitfalls later, but I have seen brands in the sake of chasing down a couple of margin points, decrease the quality of their product. If they're a box, they might usually have five to six things in it. Now they have four to five things in it. All of a sudden, consumers will eat you up.

Richard Hill:
Yeah. I see that. Yeah. I've had a lot of good experiences actually, mainly during the things I've signed up for maybe at the start of lockdown or pandemic, maybe two and a half years ago or so. I signed up for a lot of different things, personally, and I do it partly because I'm a bit of a coffee addict, so I sign up for a coffee. But I also generally do it to see what some of the brands are doing. And some of the things a lot of brands have been doing around packaging I think's been really exciting.

Evan Padgett:
Yes.

Richard Hill:
Customized packaging. Every package, basically, is unique to that person. It's got your name on it. You open it up and there's that personalization on the packaging. We've got an episode on the podcast in a couple of weeks, actually, on personalized packaging as a strand within, obviously...

Evan Padgett:
I love that. If I can drop something about that real quick, there's a company that, no skin in this game, but a company I love here. I have kids, I have three kids, one of them's a two-year-old now. My others are older. So, he's in diapers. It's a company called Hello Bello. And they're a subscription company that deliver diapers and all the stuff you need. But what I love about it is the diapers are different, design-wise, every month, or every quarter. And the boxes themselves are different. The other month we got a tractor. And then, so the kids play in it, it'll be a spaceship.

Evan Padgett:
And as a parent, I'm getting jacked up, being like, "Ooh." I see the box, I'm like, "What is that?" I'm like, "Oh, it's my Hello Bello box," and I always tell my wife, I'm like, "What kind of diapers did we get?" I'm jacked up about my kids' diapers because they'll be different this time, right? And they are so. So, that's so cool to me to just think about. It's not hyper-personalized to me, but it's a more fun unboxing experience, and the subtleties make a big difference there. And you're talking about pennies or dollars of incremental costs put in to now retain customers for longer.

Richard Hill:
Yeah, yeah. It's exciting, isn't it? I think that's the thing. Everyone's no doubt got a lot of different subscriptions. Well, that's a fact, isn't it? So, when you're getting that package, whether it's monthly, quarterly, whatever it is, and it's just the effort's been put in. When I get the various coffee ones I've got, I get a card with each coffee, they explain, the growers' family in Ecuador, or wherever it may be. Family history and about how they make the coffee, and a little picture of them in the in their farm, wherever it may be. The box, just the quality of the box. And it's a low-cost product, to be fair. I mean, I'm probably paying 14, 15 pounds, $20 a month for one of the subscriptions. And just the experience of opening that package. And obviously that endless smell of coffee is...

Evan Padgett:
That doesn't hurt. But that all those things make a huge difference. And I always tell people, if you can curate your subscription experience... Curate's a broad word. It's a dangerous and broad word, but it's also, it's what makes it feel a little bit special. It makes it feel like, when they go to Facebook or when they go somewhere else and they see, "I'm on the same subscription as you, but my box is different, and I like my box, and I think you like your box." All of that tends to start making people feel special. My background, when we were doing fashion, I worked for a huge company called TechStyle Fashion Group, that housed such brands as Fabletics and JustFab and ShoeDazzle.

Evan Padgett:
I ran a couple of those companies for a period of time, but we always had this, we literally signed people up through a quiz to determine their fashion profile, the kinds of shoes they like, their preferences. And then we would curate a boutique for them every month. That was our business model at the time. Curate a boutique of specific styles we think they like based on their preferences and the information they told us, and using that information is amazing. Now, you think, "Oh, that's a big BI lift," or that's a big machine learning lift. It's not, because what you could do is, you don't have to say, "Oh, I have 10,000 customers. That means I have to have 10,000 variations of their subscription." You could probably get away with 10 that just feel a little bit more custom based on their personas, right? And personify people. That goes such a long way, and it doesn't really take any more time to do. A little bit more effort to think about, but that's it.

Richard Hill:
Yeah, yeah. I think that's the thing. I think personalization, people get maybe a little bit scared with the level, maybe the level of segmentation you need to do. And I'm not saying don't do that, but you don't have to.

Evan Padgett:
It's intimidating. It's absolutely intimidating.

Richard Hill:
If we're talking about segmenting on email marketing, then that's a different conversation, I would say. But in terms of packaging, in terms of an experience within that delivery process, you don't need to go crazy, do you? So, okay. So, obviously, it's been quite a challenging couple of years, navigating a lot of change. A lot of different things in terms of, obviously a lot of high demand, we went into lockdown. A lot of crazy demand for certain different verticals. Then we're back out of lockdown, we're back in lockdown, we're out lockdown, we're in lockdown. There's some crazy levels of spend and then some drops, and then some ups and downs. Merchants getting used to this new level, and then, hang on a minute, it drops.

Evan Padgett:
Yeah, right?

Richard Hill:
Would you agree with that? There's been some...

Evan Padgett:
Yeah. That's basically been the past two and a half years. My beard wasn't even gray two years ago.

Richard Hill:
Yeah. So expectations, one month is like, "Jesus, we've sold four times as much," and then the next month it might be like, "Oh, what's happened? Oh, yeah, the shops are open." Different updates, this, that. Obviously a lot of that uncertainty. I just think it's being nimble enough to be able to react, but also preempt if we can. It's obviously been very difficult. But is there any really brands that you feel that have maybe failed? I mean, you don't necessarily have to say the brand name. You can if you wish. But that you feel that just haven't really navigated that uncertainty very well. Any examples of brands that have just stuck in their lane, and not really maybe adapted, tried something new, that have really struggled?

Evan Padgett:
Yeah. So, I won't name them, but there was a client of ours that was, this is one thing that the world really, unfortunately, didn't need, and this company didn't exactly adapt to at the time, which was high-ticket fashion. Not something needed during lockdown, as in, people weren't going to offices anymore. Men and women didn't need high-end fashion. And this company that we worked for that was spending upwards of somewhere around half a million dollars a month in media. The moment, the actual day was March 13th I believe in 2020. The actual day that lockdowns really started happening, they basically went into full turtle mode on this. Just into their shell. They cut us, they cut all their variable contractors. They were worried about supply chain. So, this is a different take on not succeeding. They didn't even try to adapt, really. They basically shuttered.

Evan Padgett:
Now, they're still in business. They were a very large business, and still are a pretty large business, and they're rebounding right now. But they really missed an opportunity to find a way to adapt their business model. Fashion, especially high-end fashion, has great margins, right? But what you could do is they could have pivoted to a rental model. They could have pivoted to something else, right? But they chose not to. They immediately chose to drop out of it and back away. And I saw that through other agencies and people in this industry. Basically, a lot of businesses, right around March 13th, 2020 made a decision to either put the pedal down or to hit slam on the brakes. So, that was not an uncommon thing, but I saw that firsthand happen a lot.

Evan Padgett:
I would also say, here's what has happened to brands, and we had a couple, I want to say about two or three, that were niche subscription companies that had a very well-defined, but not necessarily large audience vertical. And then, when privacy and everything started hitting with iOS 14.5, where they failed was their inability to broaden their service offering, because here's the bottom dollar with the privacy changes, iOS 14, all that stuff. Here's what it did. The more niche your product is, the harder it is to advertise, because niche products leveraged the tools that iOS essentially got stripped of, such as downstream pixel intent. So, being able to like really identify people that have intent and be able to chase them all over the internet.

Evan Padgett:
And then, two, essentially, the ability to find people with a lot of the custom lists that you're able to do. So, if you were able to share information above the board, you couldn't really market those people anymore. So what they all failed, the universal thing, "Look, we got to broaden your product offer. You can't just be this anymore. You got to be this. You got to expand. Here's the opportunity to do this, otherwise we're not really going to be able to find the people you're looking for at the scale you've been at on the internet anymore, because things have changed." So, what we always try to look at now when we're bringing in clients here at Stealth, or just brands that we're working with, is making sure that they have a large enough audience to go after.

Evan Padgett:
And then we actually advise, and I personally advise a lot of brands, I'm like, "Okay, well, you're doing this. If you were to expand out to this." So, I'll use my own path, for example. We were doing shoes. Women's shoes. And then it was like, "Okay, we should go to women's bags," because that's a common accessory with shoes. "And then we should go into actually women's fashion, but still be a shoe-focused company." I tell that story to our clients and people that I advise because, okay, say you're in outdoor gear, okay? You're in camping and outdoor gear. Pretty popular during the pandemic, right? But a bit of a focused audience. So, how do you establish maybe other outdoor activities such as get into fishing? Or get into specifically camping versus hiking, or mountain biking. Find other products that you could sell that have a lot of concentric interest with your existing customer base, and you can do fine and survive, and now you've broadened your audience pool. So, that was some of the common trends I've seen in adapting to the pandemic.

Evan Padgett:
And then, the last piece I'll mention is really, what we've already hinted around a little bit, is flexibility in your brand and marketing tactics. You have to, in general, all times, entrepreneurs, business owners, have to evolve their brand. Show me a brand 15 years ago that's in consumer packaged goods that's the same as it is now. Doesn't exist. Right? So you need to say, "Okay, I need to evolve my brand in ways to make it more applicable, to change my creative, to make it approachable," whatever you have to do. Be more promotional-heavy, right? Guess what? To get people, sometimes you got to promote, because they're taking a leap of faith. You got to put a little of your skin in the game by saying 20% off your first order, 50% off your first order, get this free gift with your first order. That's a hurdle I still go through with brands right now. So, these are all the things I encourage brands to be flexible on and adapt to if you want to go and compete in this changing marketplace. And it is changing.

Richard Hill:
That's the thing, isn't it? It always is, and always will be, I think. Obviously, maybe, hopefully not quite to the extent of the last couple of years, but yeah. Some great examples there, and it resonated a lot. I think we've got a lot of similar client bases. Different clients, but very similar scenarios that we've been through in our agency. So, I think slight change of direction there for us would be, so obviously demand in general for a lot of verticals has gone through the roof this last... There's some crazy demand, and there's some ups and downs in terms of demand. I just think of some examples of clients that sell products that have typically, we have client that we've worked for a long while that sells fish, for example. And it's not a product you would always go online to buy, but it became just quite a normal thing in lockdown down, because you couldn't go out of the house pretty much.

Richard Hill:
Their business, I can't remember how much it did exactly, but I think from memory it was like 4x in a matter of four months. And then, they built from that a whole new database of people. And so, it was very much about retaining and getting them to come back, and a whole new audience, really, that were used to going to their fish man on a Friday afternoon and buying their prawnsand maybe some of them's buying their langoustines or whatever, I don't know. But now they go and buy their fish online. So the demand, and obviously I think that's very normal for a lot of different verticals, obviously, that demand.

Richard Hill:
So, I think that inherently creates, potentially, challenges around getting demand for the products is more than ever in a lot of verticals. So the competition within that industry, so standing out in that industry, and some of the, maybe the smarter things we should be doing, our listeners should be doing around their ads, their ad spend, what they're doing in acquisition. But also some of the challenges around logistics. Getting stock in, getting stock out. What would your take be on that? Obviously this rising demand for products is great, but inherently getting in front of that demand, but then also servicing that demand, it's a two-pronged attack.

Evan Padgett:
Yeah. So right now, supply chain's tough. I speak for everything here in the United States. Seeing the amount of boats on the ports in the east and west coast waiting. The cost is going up and the time is going down. And you know what happens when your costs go up and it takes longer? That means that you have more working capital involved in your inventory now, right? Because guess what? These vendors that are selling you this stuff, they're still getting paid when it gets on the boat. So, this is where I wish I could say I had an awesome solution for this, but what it is is actually kind of primal in how you have to think about this, is the best way I can think about it, which is you got to make sure that, one, this is one of the seven areas that I always stress about is understanding your working capital needs, making sure that those needs are met, and also leave yourself a little bit of room because if you're a subscription company, for example... It sucks having inventory sitting on your shelves that you're not making money on. I totally, totally get that. You know what sucks worse? Not getting your product in, and then your customers canceling on you because of this.

Evan Padgett:
So, you could say, I have to have more working capital to get products on my warehouse shelves and knowing I'm going to sell it next month, instead of being like, "Well, instead of selling this product next month, it's stuck on the water for another month. What do I do?" And then, that's going to cost you more in customer quality, satisfaction. You're going to have to go out and buy really expensive plug inventory for your product, whatever it may be. So, man, I would just say that supply chain right now, don't assume... If you're a company, you used to be able to, and I worked in this industry, you used to be able to basically be like, "Oh, yeah, we only have products sitting on our shelve for seven days." Amazing, right? When everything ran on time. Now it's like, you're either going to have products sitting on the shelves for 30 days, or they're going to be 15 days late or 30 days late.

Evan Padgett:
So, prepare. Don't forget your customer promise. Make sure you have the capital necessary to do it. And then honestly, just, you got to plan further out ahead. So right now, if you're thinking about your holidays right now, you're late. If you're thinking about Christmas and everything, this might be at the end of time a few years ago. You're now late. You should have been already buying for holiday two months ago, depending on your supply chain. It's a challenge, man. It is something that, it can make or break companies' ability to grow. And capital markets are tough right now. So, getting money if you need it is not necessarily as easy as it was. But obviously this goes into pro forma modeling, forecasting your business and understanding that in and out, and living to play another day. Things will improve. Supply chain will improve. Will costs go down? I don't know about that. But will processes improve? Yes. Will economies turn around? Of course. So, play the long game, make sure that your company's safe. And if you're working off of a model, that'll tell you everything you need to know.

Richard Hill:
Yeah. No, I love it. Love it. And I think while things are buoyant, in some instances... Obviously, let's say things are going well for the listener that's listening in now. But the reality is if you've got to then stock another 14 to 30 days' worth of stock for certain lines, you need another hundred grand, another million pound, whatever it may be. While things are well, and things are good in some instances, in many instances, I think the ability to have that money ready to go, that funding, whether to apply for things, and then when you do need it, you're good to go sort of thing.

Richard Hill:
We've done a couple of episodes on the podcast around the different funding options that are available, tied into your eCom platform, based on your run rate on products, your sales through Amazon, your ad account spend, to raise money to either buy inventory or potentially to fund stock and to fund ad spend things, like that. Different options out there. A lot of newer funding options just based on, they plug straight into your BigCommerce and Shopify store and they go, "Yep, we'd give you 400 grand tomorrow," and it's that simple in many cases.

Evan Padgett:
Those are great. Those are great. You probably covered this on that episode. The only thing I would always say with that is make sure you're growing.

Richard Hill:
Yep.

Evan Padgett:
You got to reinvest that into growing, not to maintain homeostasis, because then you're just paying interest on the revenue you'd be making. But yeah, those are really great options, and also it's easy on the cap table, right? So, those are good options if you have an opportunity to lean into growth. I love those.

Richard Hill:
Yeah, brilliant. So, you touched on a couple of the seven areas of eCom that you're focused. I think it'd be good for you to talk us through all seven areas.

Evan Padgett:
All right. Buckle up.

Richard Hill:
Let's go.

Evan Padgett:
In no particular order, because, you hear me emphasize some more than others, but what I see routinely with businesses, the seven areas that I like to emphasize, and there's hundreds, obviously, but really, these seven I boil it down to. One, getting your reporting and KPI house in order. And what that means is, to me, it's not enough to be using your Google Analytics and your Shopify reporting, and then in-channel reporting from Facebook. It does not take a data scientist to start stitching more aggregate reporting together for you to understand your business health at all times. At least, especially, on marketing and eCommerce. Now, we're going to talk about, there's another one of these, is the back office side of it. So, cash management, P and L and forecasting.

Evan Padgett:
But just understanding the health of your business, how your website is converting, how your rebuild ratio is. If you're eCommerce and not subscription commerce, your delay, your RFM models, for recency, frequency, et cetera. Making sure that doesn't change in a moving landscape, because I have caught, so often, when I'm talking to entrepreneurs and talking to business owners, like, "Okay, so what's changed in your repeat purchase rate over the past six months?" And they're like, "We don't track that exactly. We look at how many people are purchasing this month." I'm like, "Well, do you know you're getting more or less people repurchasing?" Like, "Oh, I didn't think about it that way." Focus on that. Get your KPIs, build aggregate dashboards. Even if they're weekly updates. Daily updates can be hard. Weekly updates, take the time, because if you do not have a handle on your business, you will not proactively make changes. You will be in a reactive mode and be behind, by nature.

Richard Hill:
So, do you have any go-to recommendations in terms of reporting suites, tools, Data Studio, or you custom build?

Evan Padgett:
Yeah. So, I mean, the average consumer, if you're not going to invest into... We use an amalgamation of a handful of different technologies, things like TapClicks and a handful of different tools to extract data and aggregate it. I'm fortunate to have a BI engineer that works for us here to prepare these things for our clients. But if you're just a person out there, everything in Google Suite can pretty much get you what you need, and if you learn a handful of tips and tricks with things like Zapier and stuff like that, you can automate and stitch together basic data. Because all a lot of this is, once you have an output, you just have to say, "Okay, this output," or part of it, based on what condition needs to go here, and just bringing this all together so you're looking at that.

Evan Padgett:
And if you're a chief officer at this company or the CEO of this company, just making sure that you keep an eye on that and keep everything honest, because the changes happen subtly. You'll have one bad week and one bad week turns into two bad weeks. Two bad weeks can turn into a month really quickly, and then at that point, you're looking at your P and L. You're like, "Wow, we made a hundred thousand dollars less this month than anticipated. We have a problem here." Stay on top of it. So, get that world in order. You could do most of it with G Suite, and feel a lot better about it. Get moderately literate in Excel or G Sheets, and you'll be fine.

Richard Hill:
I think that's great. So, that's the first one.

Evan Padgett:
First one. This is why I said buckle up, man. I'll go a little quicker on some of these. Cash management we've already talked about. So, cash management and pro forma modeling. You need to know where your cash is going in and out. Cash is your primary resource when it comes to growing your business. And guess what investors love to do? Is give you cash when you need it the most. But what that's going to do, that's going to cost you more of your business, right? So, making sure that your financial house is in order and that you have a always minimum quarter out forecast of what your business is trying to do.

Evan Padgett:
Use that to set goals, use that to set the tone of the business, use that to set your hiring plan. And people say, "Yeah, we budget. We forecast." But I'm like, "Do you really, really?" Because what a lot of people do is they just say, "Oh, we're growing 10%, so revenue's going to go up 10%." I'm like, "Based on what? Seasonality?" Guess what? Seasonality is back in advertising now. Summer months and advertising three years ago, four years, five years ago, they sucked. But now, you account for that. You account for that slump in the summer, and make sure you're forecasting, and make sure your cash is never in an uncomfortable position.

Richard Hill:
Yeah.

Evan Padgett:
So, that's number two. This one, I'll be really quick on. Inventory and procurement. We just talked about that. Your supply chain can change, can be fluid. Account for more time. This goes into the one above, too, around cash management. Make sure that you are paying attention to your supply chain because, especially if you're a subscription company, the earlier you know something is going to go sideways, the more time you have to react, the less expensive it's going to be. And getting in front of that message with your consumers is better. People don't mind being told that their box is going to come 15 days later, when you tell them a month earlier. They get really off when they say it's going to be 15 days later when it's already 10 days late. So, getting ahead of that.

Evan Padgett:
This is a big one, this next one, number four. Team. So, the people that are running your business. And the next part of this is also important. Team. And then, so four and five. Team and automation. Right now, if you're running a little bit concerned about things, and everyone's, a lot of people are focusing on profitability and bottom dollars. Well, when you have a team that is doing what they're supposed to do, right people, right seats, that's okay. And I'm not saying that's good. That's actually okay. What's good is you have people pushing your business forward.

Evan Padgett:
It doesn't mean this person that is doing a great job couldn't be doing something better, or that's bad that they're not doing more. But as a leader in your company, you can't forget that, while it's been easy for a lot of eCommerce companies, barring the last six months, the previous two years, were really good for most eCommerce companies. Your team, it's a world right now in the "great resignation" here in the US. Quality people that are really good at their jobs are increasingly harder to find and more expensive to do so. Focus on your team. Focus on making sure that you have the right people, the right seats, that they are getting what they need out of you as a company, because you don't want somebody just pulling levers and turning knobs. You really want someone engaged and pushing your business forward.

Richard Hill:
It's engaged and gives a damn. Wants to be there, and they're looking to improve your business, or the business, as if it's their own, yeah.

Evan Padgett:
Exactly. And it's easy at the top. It's easy when you're an executive at a company, or the CEO of a company, to push down directly because everyone's like, "Yeah, I'm doing it." But take a moment to just check in with people, because there's a lot going on just in the world. Even just connecting with people. Don't treat them like objects. Treat them as people, because we're all going through our own stuff. Invest into them.

Richard Hill:
Yeah. That little thing there, that take a moment to connect with them. I think that is so vital, so important. It's been a crazy, crazy time, and just having a bit of time with your team, all the way through

Evan Padgett:
Yeah. At Stealth, we are very heart-centric and I would say a very emotionally intelligent group of people, where we really do work on our authentic relationship-building. Because look, work is work. There's things that have to be done. But don't forget that you can only push so hard before people end up not caring and don't want to work for what you're doing anymore. So, take a moment. This segues into automation. Right now, a lot of companies have thrown people at problems and processes, and especially hyper-growth. If you experienced hyper-growth in the past two years, awesome for you, but take a moment to look at what you can automate and become more efficient at.

Evan Padgett:
This isn't about trying to find out, "Oh, well we don't need this person anymore, or we can drop two positions." It's actually about how to make your business generally more efficient and scalable. And I tell people, the goal should not be to reduce headcount. It's actually just slow headcount growth in the future, and applying things that are annoying in automation, especially in a work-remote environment. So, Stealth has been remote for seven years now, so pre-COVID and everything. There are so many easy things you could do now that just automate certain things in Slack and trigger off requests and ticketing systems in Asana and communications. All these things can be done more automatically, which just reduces friction and makes you a better-run organization.

Richard Hill:
What would you say are a couple of automations that, when you're working with brands that maybe they're not doing? A couple of quick hits for listeners.

Evan Padgett:
So, reporting automation. Talked about that. Anybody that's manually pulling a report down these days from primary systems like Shopify, automate that. Automate that. It takes 30 minutes.

Richard Hill:
Coming to you, yeah.

Evan Padgett:
Yeah, you can have it sent to your inbox and do that. And then, things start getting more sophisticated beyond that. So, a lot of companies, I won't speak for people that aren't on this, but Slack is a pretty common tool. So many fun automations now with Slack, and probably any technology you use. We use Asana. So, we can do a couple of keywords in Slack, kick off Asana tasks and make things happen. So, as an agency, that's helpful for us, but if you're inside a business, y'all have tasks still the same way. You can kick those off, automate them off of keywords, off of commands, your own custom commands and strings. So many fun tools.

Richard Hill:
Yeah, yeah. That's what we do. We do exactly that. Slack and Asana integration, yeah.

Evan Padgett:
Yeah, it's so smooth. And again, you're talking about saving minutes, but you're talking about saving hundreds of minutes every day, thousands of minutes a month. Adds up. Other automations I would consider looking at. If you have regular presentations. So, again, we're in a service provider world. So, we have gotten to the point where we've been able to automate most of the content that goes in our weekly or monthly summaries, where we just basically hit a button, kick out all the data that we need for our client for a month, for example, and then we just have to add color commentary, saving us several hours a month. So, internally, in a business, how that reflects is if you have a management hierarchy, you can do the same thing and create systems that create all the regular reporting and automate what you do. So, just be curious about that, because I guarantee you, for most eCommerce businesses out there, if you're like, "I think this could be automated," chances are someone's already done it and there's probably a blueprint on how to do it, or you could figure it out yourself.

Richard Hill:
So I think if you're sitting, listening to this episode and you think about your daily routine, your weekly routine. You get up in the morning, you log into your system. How many orders did you do? What was the, whether it's your numbers, how many orders, conversion value, your ad spend. All this stuff, what we're saying is, can be pushed straight to you, a little glance in the morning with the key five, 10 KPIs. Bang.

Evan Padgett:
Yep.

Richard Hill:
Not going to go and get it. You haven't got to log into two, three, four systems. You're getting it pushed to you. Whether that's daily, weekly, monthly. Obviously different KPIs for different stakeholders, depending on, marketing team probably need to know a bit of a wider scope of variables, where owners, managers, probably more interested in a handful, usually with a pound sign or a dollar sign at the beginning of it.

Evan Padgett:
Yeah, right?

Richard Hill:
So yeah, having those things.

Evan Padgett:
But it starts broad. So, the sophisticated part, this is where it gets a little bit deeper than the average person. But I've spent most of my career in analytics. You start with all of the metrics, which is then, like, "Oh, this is everything the marketing team needs." Then you start rolling things up. Then you start creating alerts and triggers that says, "Hey Mr. CEO," or Ms. CEO. "You've been off of goal for five days in a row. This is a problem. You need to go talk to somebody else." We have it to the point here at Stealth where, when an account is missing its goal for more than a certain number of days, it actually kicks off a set of communications to the people that work on the accounts, and then the people that work on the accounts then pay special attention. We have comms, we have a strategy. We basically huddle up and say, "Okay, something's amiss here." That's easy stuff to do, and it tells you how to do most of your job.

Richard Hill:
Yeah, we do a very similar thing. We set forecasts in inFlow, every client has a set forecast, and then obviously they're either on track or off track. It's that simple. If they're off track too long, that's a problem. Okay, so I think...

Evan Padgett:
I got two more. I got two more.

Richard Hill:
Yeah, I was going to say, we got to number five I make it. So we got two left.

Evan Padgett:
These ones are a little more fun. We talked about this, creative production. So, creative these days, and thinking about as a marketer, what we need, creative is the ammo that we all need to market with in these platforms. TikTok, Snap, Pinterest, et cetera. Facebook. All the world. Guess what? TikTok ads don't work as well on Facebook. Facebook ads don't work as well on TikTok. They all have their own little niche these days. Great for the platform, harder to advertise on. So, focusing on creative production that helps tell your brand story, is fun and engaging, and feels natural to the platform, is key.

Evan Padgett:
So, there are so many tools. Influencers, five, 10 years ago, five, eight years ago, they were basically affiliates that would create content. You would try to monetize and pay them a bounty, right? That's not really how they work these days, but I'll tell you what. Content creators on these platforms, they make great ads that would work well on the platform, because, right now we use a lot of TikTok Creator Marketplace for a lot of the ads. We tell them what to do and the things to say, but then they make something awesome for the platform because they got a couple million followers. They know how to manipulate the platform the right way.

Evan Padgett:
You can outsource almost all of your creative production, with the right tools in place, to get raw assets, to get raw creative assets that work well on these advertising platforms. But focus on it these days. Don't have boring stills, and, "Hey, here's our staged shot of this product sitting on a table, surrounded by fruits and veggies on a plate." No. That's not going to work anymore. You need to have somebody engaging with your product. Somebody that also it feels is either known or made an ad for that platform, and they know really well. Getting that in-house is great, but you can outsource, for big brands, I'm talking brands that are spending millions a month on advertising, could almost outsource probably 90% of their creative production. So, that's number six.

Evan Padgett:
The last one. This is a weird one. This is one that only matters for some, but can bite you if you don't pay attention to it so I like to put it on here. Your brand reputation. So, easy enough to sit there and be like, "Oh, we're doing well. We're crushing all this stuff." But then, people don't pay attention to their Google reviews, to Trustpilot, to the Better Business Bureau, to what people are disregarding, what people are saying about them on Facebook, until it's too late. It only becomes a problem when it finally bubbles up to the surface and there's enough people piling on.

Evan Padgett:
So, brand reputation. There are a lot of tools out there that are relatively inexpensive. Funnily enough, they all escape me right now, but that basically can monitor sort of the pulse of your brand and how it's seen and where it crops up. You're going to have some people that don't like what you're doing. You're going to make a mistake. And you try to do your best to make good, but a product gets lost in the mail. It shows up broken.

Richard Hill:
It happens.

Evan Padgett:
Falls off a truck. Who knows, right? You could do your best to make it right, but you still might have an upset customer. You're not talking a hundred percent here, but what you're talking about is, when you're getting a growing number of people saying things like, "A couple months ago, this product was really good, but I don't know what they did. It doesn't taste the same anymore," "The fabric is different," "I used to get more in the box, but now they gave me stuff I already had or they gave me that same box I had last month. This is stupid." Pay attention to that stuff, because when you are finding new customers, guess what they do? They're going to Google search you, and they're going to say, "Oh, I want to see reviews on brand X." And then, if you got two stars or three stars, you're in an uphill battle for that new customer already.

Evan Padgett:
So, keeping a pulse on your brand reputation, it's one of those things that also tends to come up when you're doing really well, because you will have a string of successes and you'll be like, "Oh, we tripled or quadrupled our customer base. 10X'd it in six months. It's amazing." And then you're like, "Well, why does everybody hate us?" So then, don't disregard that. Make sure you have mechanisms in place that respond to things on the BBB that bring up issues that might be systemic before they are, before you're buying inventory and all these things. Just don't forget about it, because it's the sort of thing that, if it topples over, it'll take you over a year to fix.

Richard Hill:
Yeah. Brilliant. So, there's seven there to go out. I think there'll be a few of those that will resonate, or, all of them should, really. There's quite a lot of things there that I think, our listeners, I know, are a very savvy bunch. Most of our listeners aren't starting out. They're very much, "How are we going to get that next million, 10 million?" Whatever it may be. So, I think, you're tying a lot of stuff back to the P and L, that funding piece. There's obviously a lot of different things there. So, future. Crystal ball time. We're sat here, Evan, in maybe... eCommerce years, they're a bit like cat years, aren't they? We're sat here in 18 months, which is probably five years in real money. What are we going to be talking about? What are some of the things that our listers need to get in front of now?

Evan Padgett:
Yeah.

Richard Hill:
What would you say are the things that are coming down the pipeline?

Evan Padgett:
Right now, advertising's changing. I would actually go on record, I'm on record, so it doesn't matter. I'd say from a digital advertising sense, the past six months, and really the next 10 to 12 are going to represent a significant shift in how we are spending advertising for our clients, and how brands are spending advertising. Here's what I would estimate. One, channel diversification. You're not going to just come out of the gate or operate off of just Facebook and IG and Google anymore. Be curious and experiment on every channel out there. Things like direct mail, fun piece of advertising. Probably the least inflated piece of advertising in 20 years if you think about it. Chances are you're making good content. Play around in OTT and CTV. There's never been a better time to try more advertising platforms.

Evan Padgett:
I think there is a play, and I don't want to get too geeky about it, because I would say I'm a little bit nascent on this too. There's going to be a play into Web3, metaverse-style, advertising. Advertising props up the internet and everything we do. That shouldn't really be a secret when you boil it down. With that comes additional opportunities for advertising, product placement, brand recognition, plays, things like that. There's going to be a lot of experimental advertising, so look around where you are seeing... I just always like to tell people, be observant. As an advertiser, you get muted over time to how many ads you're being bombarded with across all mediums.

Evan Padgett:
Pay attention to those for a minute. As a business owner, pay more attention to those. Ask questions like, "How do I get our product there?" Find the firm that helps you get that placement, because you'll be like, "Wow, I'd buy that," or, "I like this ad unit," or, "I like the way this ad's been done." Be curious on that and seek that out, because it's easy to get complacent over the past 10 years of advertising, which has largely been, "We're just going to launch a product and we got to advertising set up on Facebook. I just need someone to help me make some audiences and we're good."

Richard Hill:
I think that's brilliant. I think be curious, experiment. There's a lot of other platforms, isn't there?

Evan Padgett:
A lot. And they are all priced really good right now for people jumping into that market. Then, being observant. Again, when you see an ad, notice that, "Oh, somebody, somehow paid for that product to be there. How did they do it? I want my product there." And then, "How do I find out how to make that happen?"

Richard Hill:
Reverse engineer what you're seeing in your industry from the bigger guys.

Evan Padgett:
Yeah.

Richard Hill:
Brilliant. Right, Evan, it's been an absolute blast. There's probably about 25 takeaways that I've made a note of in my diary here.

Evan Padgett:
Awesome.

Richard Hill:
Which we'll highlight on the show notes. But we like to finish every episode with a book recommendation. Do you have a book to recommend?

Evan Padgett:
Can I recommend two?

Richard Hill:
Go on? We'll let you.

Evan Padgett:
All right. I'll do one in the broader company sense, one personal one. One thing for me, I love this book. I go back to it every so often, a book called The Power of Habit. It's just a great, introspective book. Basically helps teach you why you do the things you do, helps you break those habits, helps you recognize them. I just like that from a personal sense, because when we're punching, in punching out, working every day, it can feel very routine. And when you're trying to grow a business, you got to snap the routines sometimes that you already have. So, that's just a fun personal book.

Evan Padgett:
In a business sense, this one's going to be maybe controversial, maybe not. There is a system that we apply called EOS, the entrepreneur operating system. Traction. I've done a lot of different corporate management frameworks that have existed. Traction's been my favorite, and EOS and the application of that. Just note that you're not going to get everything you need just by reading Traction and just by looking at the surface layer of EOS, but that is a great system for entrepreneurs, for companies that have the integrator visionary combo at the top anyway, to figure out how to navigate and grow businesses. So, I'm a huge fan. I've been through several trainings for EOS and I'm a huge fan of that. So, Traction. Read Traction, I guarantee it'll resonate to how you're running your business.

Richard Hill:
That's a brilliant recommendation, one we've not had before.

Evan Padgett:
Really?

Richard Hill:
And I'll tell the listeners that we run off Traction and EOS as well. We've been running it for about 18 months now, and it's really transformed a lot of things in the business. We talked in this episode about three-month sprint, if you like, and Traction refers to that. You've got a vision. When we're talking about the vision and getting all the team on board, which we touched on as well in the episode, ultimately, you've got to get the team on board. Well, this is where the vision, and understanding how their part plays amongst the maybe bigger picture that maybe some people on the team won't see until you talk that through. So, Traction. Brilliant recommendation. I can't believe we've not had that before actually.

Evan Padgett:
Me either. Awesome.

Richard Hill:
I think we need to get Gino on. Gino Wickman.

Evan Padgett:
Absolutely. Brilliant idea.

Richard Hill:
We'll get him on. We'll tag him up in this one and we'll have him on in a couple of weeks, hopefully. But yeah, we're massive, massive fans. I think we've bought about 50 copies of the book.

Evan Padgett:
We give it out to every new hire when we bring them in, so, yep.

Richard Hill:
Yeah, brilliant. Right, Evan. So, for the guys that are listening in, what's the best way to reach out to you, find out about yourself more so, and Stealth Venture Labs? What's the best way to do that?

Evan Padgett:
So, you can reach me at evan@stealthventurelabs, to give you my company email. evanpadgett@gmail. You can reach me personally, that's cool too. Find me on LinkedIn. There's not too many Evan Padgetts out there. And then, of course, you can just go to our website, stealthventurelabs.com, see what we're up to, get some case studies. We have a non-profit arm as well that I love. If you're an expert and you just want to help, we have a system set up for helping inner city kids and youth become entrepreneurs, and we actually fund them with capital to do advertising. Check all that out. Reach out to us, reach out to me. I love talking about this stuff all the time. As you can see, I just love blabbing about it. So, reach out and I'll blab anyone's ear off.

Richard Hill:
Evan. It's been an absolute blast. I look forward to catching up with you again. Thank you for being on the show.

Evan Padgett:
Thank you, Richard.

Richard Hill:
Thank you.

Evan Padgett:
Have a good day.

Richard Hill:
Thank you for listening to the eCom@One eCommerce podcast. If you enjoyed today's show, please hit subscribe and don't forget to sign up to our eCommerce newsletter, and leave us a review on iTunes. This podcast has been brought to you by our team here at eComOne, the eCommerce marketing agency.